Paul Murray opinion: Why the WA gas debate is full of hot air amid Scarborough gas field project

So the fossil fuel industry is supposedly dead. Except when it isn’t. Green activists have been telling us for years that new projects will not be able to get finance because renewables are now price competitive and banks would avoid businesses whose carbon emissions threaten the planet, but Woodside has just announced the go-ahead for the $16 billion long-term development of the massive Scarborough gas field off the WA coast. Which suggests that the disrupted industry isn’t even in its death throes yet. “The final investment decision is underpinned by quality customer support with approximately 60 per cent of Scarborough capacity contracted,” Woodside CEO Meg O’Neill, pictured below, proclaimed on Monday. “Developing Scarborough delivers value for Woodside shareholders and significant long-term benefits locally and nationally, including thousands of jobs, taxation revenue and the supply of gas to export and domestic markets for decades to come.” For decades to come. Why are the smart people who run Woodside seemingly swimming against the international green tide with company projections showing them selling Scarborough LNG beyond 2050? Woodside says Scarborough’s domestic gas supplies for WA use are contracted to 2046 “with options to extend”. The green mantra has convinced many people that our energy needs will be totally supplied by renewable and non carbon-emitting sources by 2050. So what’s going on? The key is in the detail of the international pledges which are for “net zero emissions” by 2050. And “net” zero doesn’t mean no emissions. It means that all remaining carbon emissions will have to be offset by either natural methods or technology. Which takes some swallowing. The net zero commitments — which at this stage are not legally binding on any country — are due to come into force in 2050, but we have to get to that date somehow while keeping the lights on and the economy running. O’Neill neatly nailed where the responsibilities for Scarborough gas emissions lie in an article in this newspaper on Thursday. “For our customers internationally, it means access to a reliable energy source as their economies transition to a net zero future,” O’Neill wrote. “As signatories to the Paris Agreement, and with their own net zero targets, these countries need to offset or abate greenhouse gas emissions.” Similarly, the McGowan Government has washed its hands of the Scarborough project’s ongoing environmental consequences, both locally through its processing operations as well as the export of a fossil fuel which has half the carbon emissions potential of Australian coal exports. “The development will deliver large volumes of gas into the WA market, in support of the State’s long-term energy needs and ongoing economic development,” Premier Mark McGowan said. “Consistent with the WA Domestic Gas Policy, the Scarborough joint venture will make gas equivalent to 15 per cent of its LNG exports available to the domestic market.” So McGowan clearly wants WA to keep using gas for many years into the future. “LNG can be used globally as a transition fuel to displace more carbon intensive fuels such as coal and there is strong demand in international markets that have made commitments to net zero emissions,” State Development Minister Roger Cook said. “Natural gas is not only one of WA’s most profitable exports, it is an important energy source for local industries that will help diversify the State’s economy and create more jobs.” Cook’s rhetorical point about Scarborough gas replacing more heavily emitting coal is fair up to a point. While Federal Labor has crab-walked away from coal, its platform says gas is critical to achieving net zero by 2050 by acting as a “firming fuel” for renewables, providing energy to fill the gaps in intermittent wind and solar supply. “Labor recognises and supports the critical role that gas plays in the Australian economy,” the platform says. “Labor recognises that gas has an important role to play in achieving Labor’s target of net zero emissions by 2050. “Labor recognises that gas-power generation has a critical role to play in firming the National Electricity Market (NEM) to ensure reliability and price affordability as it transitions to net zero emissions and as other technologies emerge.” WA is not part of the NEM, and our South West interconnected energy grid is still highly dependent on Collie coal — with no clear end-date for when the Government will stop its support for the mines there. The SW grid will also continue to rely on gas for firming as the proportion of intermittent renewables grows, even with the expanded use of batteries. So Labor both here in WA and Federally will now be pitted against a concerted green push to halt any further fossil fuel developments and to phase out their use much more rapidly. McGowan wasn’t helped this week by the comments of former Labor premier Carmen Lawrence, now president of WA’s Conservation Council, attacking the Scarborough go-ahead. “Climate change is happening now, it’s real, it’s destructive and anything that adds to it, surely has to be questioned,” Dr Lawrence said. “I don’t see how anyone living in WA can ignore this because it adds to our emissions.” The McGowan Government initially tried deflecting green anger over the Scarborough go-ahead by claiming that the project fell under approvals given in 2007 by its Liberal-Nationals predecessors. But while O’Neill says others are responsible for the emissions from the use of Scarborough’s gas, Woodside has to deal with those from its Pluto plant on the Burrup Peninsula under WA laws. And WA’s Minister for Environment and Climate Action, Amber-Jade Sanderson, green-lit Scarborough when she signed an updated greenhouse gas abatement program for Pluto. “This updated GGAP, which now commits the project to deliver a 30 per cent reduction in the originally approved emissions by 2030 and net zero emissions by 2050, was approved by Minister Sanderson earlier this year,” a McGowan Government statement said. As I examined in a column on October 30, the McGowan Government went much further than even Woodside in proclaiming the company’s proposed hydrogen plant at Kwinana — partially fuelled by gas — was clean and green. Which it certainly won’t be. But, conversely, to believe that LNG has no future, you need to believe that hydrogen as a replacement fuel is just around the corner. Which it isn’t, as much as entrepreneurs like Andrew Forrest would like us to believe it is, even though the Morrison Government says it will hand out $464 million to expedite seven hydrogen production “hubs” nationally. Once again, smart business operators smell government subsidies a mile off even while Forrest argues that a diesel fuel road user rebate scheme — which is not a subsidy but a tax exemption for use off-road — should be axed, with the saved money going to hydrogen projects. How we get from our heavy reliance on fossil fuels to a future based on renewables — especially green hydrogen — will take strong political leadership and a much better understanding of what is involved by the public. When the Scarborough project’s gas starts up in 2026 it will represent 10 per cent of Australia’s total LNG exports. It will also see Pluto’s emissions rise to 3.6 million tonnes of greenhouse gases a year. To put that in perspective, our national emissions at March were at 494 million tonnes annually, 27.8 million tonnes lower than the previous period. Despite the green claims that WA is lagging the rest of the world, official figures show Australia’s emissions have declined 23.4 per cent since their 2007 peak. Emissions in the year to March were 20.8 per cent below those in the year to June 2005, which is Australia’s baseline under the Paris agreement. But WA’s are growing. Three protesters who blocked the road to the Pluto plant this week managed to grab media attention without much counter-balancing coverage of what is at stake if the project doesn’t proceed. And the Conservation Council will get a Supreme Court hearing next month on its application to overturn the environmental approvals for Scarborough and the expansion of the Pluto plant, sparking McGowan to flag an intervention if the decision goes against Woodside. “We can’t have scores of industries close down because of a court ruling, so the State Government will do what it has to do to make sure industries stay open,” McGowan said. “We want to keep the lights on and make sure our hospitals continue to function.” The ABC this week proclaimed Scarborough “a last hurrah for gas”. With solid bipartisan political backing for the fossil fuel, the ABC’s greenies shouldn’t hold their breath waiting for the final cheer.